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Section A: General News


Abbott warns East Texas residents to avoid possible tax-refund scam




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December 26, 2012 | 888 views | Post a comment

AUSTIN -- Texas Attorney General Greg Abbott has revealed that the state is investigating a fraudulent tax- return scheme and warned East Texas residents to avoid recruiters from Syam Tax Services LLC. The Texas Attorney General’s office does not typically acknowledge investigations, but disclosed the investigation into Syam Tax Services in order to help prevent additional victims from being harmed by the tax-fraud scheme.

Although the state’s investigation is still ongoing, the preliminary results show that Syam Tax Services enlisted recruiters to canvass small East Texas churches and senior residences for elderly victims who receive Social Security or disability benefits. Prospective victims are told that low-income Social Security recipients are eligible for a cash benefit under a federal stimulus funds program. Next, victims are told to complete a form -- which includes providing their driver license, Social Security, and bank account numbers to Syam’s recruiters in order to receive their federal stimulus benefits. Without the victim’s knowledge, Syam subsequently prepares and files a fraudulent tax return in the victim’s name.

The tax return prepared by Syam and submitted to the Internal Revenue Service (IRS) not only requests the payment -- but also directs the IRS to deposit more than half of the resulting tax refund into Syam’s own bank account.

When the IRS realizes that the tax return is fraudulent, the agency contacts the victim and demands that the taxpayer repay the entire tax refund, plus penalties and interest. Since Syam never informed victims that it would file a tax return or retain a portion of the refund, victims first learn they are liable for the full amount of the fraudulent tax refund when they receive the letter from the IRS.

To avoid becoming a tax scam victim, the Office of the Attorney General urges Texans to take several steps before hiring a tax return preparation professional:

•Ask for the tax preparer’s credentials.

•Check with the Better Business Bureau for complaints against the tax preparer.

•Verify whether the tax preparer is a certified public accountant.

•Make sure the business is open year-round in the event clients need to ask follow-up questions about their returns.

•Read the tax return carefully before signing it. Never sign a form with spaces left blank.
 

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